Editorial: Bill will end outrageous policy on tax overpayments

Saturday

Mar 29, 2014 at 12:00 PM

Our view: Passage will mean state can't play finders keepers anymore

The Ohio House acted this week to right a long-standing wrong. The Senate should do the same.

On Wednesday, the House passed a bill that ensures that businesses and residents who have overpaid state taxes will be notified of that fact. The Department of Taxation will issue refunds or credits toward future taxes.

As it stands now, taxpayers who don’t request refunds within the three- or four-year statute of limitations (depending on the nature of the taxes) are out of luck.

The policy, which dates through several administrations, conveniently ignores the likelihood that many taxpayers who overpaid don’t know it and so won’t ask for refunds.

Bills to undo the damage were introduced after the Ohio inspector general revealed in 2013 that the state had failed to pay more than $30 million in refunds that individuals and businesses had requested. The report also said that the state was holding on to as much as $294 million in overpayments for which refunds hadn’t been requested.

To its credit, the Kasich administration started returning the overpayments as soon as it learned of the problem. Senate passage of the bill that the House approved Wednesday will finish the job, ensuring that the state can’t play this outrageous game of finders keepers again.